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UNIT-I
Economic Operation of Power Systems -1
Overview

Economic Distribution of Loads between the Units of a Plant

Generating Limits

Economic Sharing of Loads between Different Plants
Automatic Generation Control

Load Frequency Control
Coordination between LFC and Economic Dispatch
A good business practice is the one in which the production cost is minimized without sacrificing
the quality. This is not any different in the power sector as well. The main aim here is to reduce the
production cost while maintaining the voltage magnitudes at each bus. In this chapter we shall discuss the
economic operation strategy along with the turbine-governor control that are required to maintain the
power dispatch economically.
A power plant has to cater to load conditions all throughout the day, come summer or winter. It is
therefore illogical to assume that the same level of power must be generated at all time. The power
generation must vary according to the load pattern, which may in turn vary with season. Therefore the
economic operation must take into account the load condition at all times. Moreover once the economic
generation condition has been calculated, the turbine-governor must be controlled in such a way that this
generation condition is maintained. In this chapter we shall discuss these two aspects.
Economic operation of power systems
Introduction:
One of the earliest applications of on-line centralized control was to provide a central facility, to
operate economically, several generating plants supplying the loads of the system. Modern integrated
systems have different types of generating plants, such as coal fired thermal plants, hydel plants, nuclear
plants, oil and natural gas units etc. The capital investment, operation and maintenance costs are different
for different types of plants.
The operation economics can again be subdivided into two parts.
i) Problem of economic dispatch, which deals with determining the power output of each plant to meet the
specified load, such that the overall fuel cost is minimized.
ii) Problem of optimal power flow, which deals with minimum – loss delivery, where in the power flow,
is optimized to minimize losses in the system.

In this chapter we consider the problem of economic dispatch. During operation of the plant, a
generator may be in one of the following states:
i) Base supply without regulation: the output is a constant.
ii) Base supply with regulation: output power is regulated based on system load.
iii) Automatic non-economic regulation: output level changes around a base setting as area control error
changes.
iv) Automatic economic regulation: output level is adjusted, with the area load and area control error,
while tracking an economic setting. Regardless of the units operating state, it has a contribution to the
economic operation, even though its output is changed for different reasons.
The factors influencing the cost of generation are the generator efficiency, fuel cost and
transmission losses. The most efficient generator may not give minimum cost, since it may be located in a
place where fuel cost is high. Further, if the plant is located far from the load centers, transmission losses
may be high and running the plant may become uneconomical. The economic dispatch problem basically
determines the generation of different plants to minimize total operating cost.
Modern generating plants like nuclear plants, geo-thermal plants etc, may require capital investment of
millions of rupees. The economic dispatch is however determined in terms of fuel cost per unit power
generated and does not include capital investment, maintenance, depreciation, start-up and shut down
costs etc.
Performance Curves Input-Output Curve
This is the fundamental curve for a thermal plant and is a plot of the input in British
Thermal units (Btu) per hour versus the power output of the plant in MW as shown in Fig1
Incremental Fuel Rate Curve
The incremental fuel rate is equal to a small change in input divided by the corresponding change
in output.

The unit is again Btu / KWh. A plot of incremental fuel rate versus the output is shown in Fig 3
Incremental cost curve
The incremental cost is the product of incremental fuel rate and fuel cost (Rs / Btu) the curve is
shown in Fig. 4. The unit of the incremental fuel cost is Rs / MWhr.
Fig 4: Incremental cost curve
In general, the fuel cost Fi for a plant, is approximated as a quadratic function of the generated output
PGi.
The incremental fuel cost is given by